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stock and P1,400,000 of retained earni O from its separate operations and pai reported income of P130,000 and paic ilities of Intrigue have book values equ Assume income was earned evenly thr mpany transaction on October 1. On Oc ent from Intrigue for P200,000. The bo

stock and P1,400,000 of retained earni O from its separate operations and pai reported income of P130,000 and paic ilities of Intrigue have book values equ Assume income was earned evenly thr mpany transaction on October 1. On Oc ent from Intrigue for P200,000. The bo

Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
ChapterA2: Investments
Section: Chapter Questions
Problem 25E
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On July 1, 2013, Issue Company purchased 80% of the outstanding shares of Intrigue Company at a cost of P1,600,000. On that date, Intrigue had P1,000,000 of capital stock and P1,400,000 of retained earnings. For 2013, Issue had income of P560,000 from its separate operations and paid dividends of P300,000. For 2013, Intrigue reported income of P130,000 and paid dividends of P60,000. All the assets and liabilities of Intrigue have book values equal to their respective fair market values. Assume income was earned evenly throughout the year except for the intercompany transaction on October 1. On October 1, 2013, Issue purchased an equipment from Intrigue for P200,000. The book value of the equipment on that date was P240,000. The loss of P40,000 is reflected in the income of Intrigue indicated above. The equipment is expected to have a useful life of 5 years from the date of sale. 1. In the December 31, 2013 consolidated statement of financial position, how much is the consolidated net income attributable to the parent company? A. P642,400 B. P930,400 C. P946,400 D. P962,400
Transcribed Image Text:On July 1, 2013, Issue Company purchased 80% of the outstanding shares of Intrigue Company at a cost of P1,600,000. On that date, Intrigue had P1,000,000 of capital stock and P1,400,000 of retained earnings. For 2013, Issue had income of P560,000 from its separate operations and paid dividends of P300,000. For 2013, Intrigue reported income of P130,000 and paid dividends of P60,000. All the assets and liabilities of Intrigue have book values equal to their respective fair market values. Assume income was earned evenly throughout the year except for the intercompany transaction on October 1. On October 1, 2013, Issue purchased an equipment from Intrigue for P200,000. The book value of the equipment on that date was P240,000. The loss of P40,000 is reflected in the income of Intrigue indicated above. The equipment is expected to have a useful life of 5 years from the date of sale. 1. In the December 31, 2013 consolidated statement of financial position, how much is the consolidated net income attributable to the parent company? A. P642,400 B. P930,400 C. P946,400 D. P962,400
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